In a notable end to the trading week, benchmark equity indexes in the US experienced an uptick on Friday. However, these gains are juxtaposed with considerable weekly declines, primarily spurred by ongoing uncertainties surrounding the trade policies of the Trump administration. The Nasdaq Composite climbed 0.7% to close at 18,196.2, while the S&P 500 saw a modest increase of 0.6%, reaching 5,770.2.
Meanwhile, the Dow Jones Industrial Average advanced by 0.5%, settling at 42,801.7. Among various sectors, utilities emerged as the primary gainers; conversely, consumer staples faced significant downturns. Despite Friday's uptick, the indexes notably suffered losses throughout the week, with the Nasdaq dropping 3.5%, the S&P 500 facing a decline of 3.1%, and the Dow experiencing a fall of 2.4%. Market experts, including Nigel Green, chief executive of the financial advisory and asset management firm deVere Group, have commented on the situation.
He noted, 'Shifting tariffs imposed on Mexico, Canada, and China, coupled with the potential extension of these tariffs to the European Union, are generating waves of uncertainty within the market, inciting turbulence.' With these trade policy shifts in mind, Federal Reserve Chair Jerome Powell expressed the necessity for 'greater clarity' before determining the direction of interest rates. Powell elaborated, stating, 'As we receive more information about these policy changes, our focus will be on distinguishing between significant signals and background noise as conditions evolve.
Despite the heightened uncertainty we observe, the US economy maintains a stable position.' In related news, the White House is contemplating the introduction of tariffs on Canadian products, including lumber and dairy, potentially as early as Friday. This could be a strategic response to the current tariffs Canada holds on US goods.
Just the prior day, the US administration had granted temporary tariff exemptions for Canadian and Mexican products that comply with a North American trade agreement. It’s notable that the US has recently doubled tariffs on Chinese imports, prompting Canada and China to announce retaliatory measures. Shifting focus to treasury yields, they experienced a notable increase on Friday, with the 10-year rate rising by 2.5 basis points to 4.31%.
The two-year rate also increased by 3.9 basis points, settling at 4%. In the realm of employment, nonfarm payrolls in the US reportedly rose by 151,000 last month, as detailed by the Bureau of Labor Statistics. This figure, however, fell short of the expected consensus of a 160,000 increase according to a Bloomberg survey.
Additionally, the unemployment rate saw an uptick, rising to 4.1% from 4% recorded in January, which aligned with market expectations for February. Economic advisors at TD Economics have suggested that, moving forward, job growth may encounter challenges, particularly as federal layoffs related to the Department of Government Efficiency are projected to increase.
Furthermore, the prevailing uncertainties surrounding trade policies are anticipated to negatively affect near-term hiring intentions. On a brighter note for commodities, West Texas Intermediate crude oil saw a rise of 1% to $67.04 per barrel on Friday. Now turning to corporate developments, shares of Broadcom ($AVGO) surged by 8.6%, marking it as the standout performer on the S&P 500.
This optimism follows their recent earnings report and a positive outlook for fiscal second-quarter revenues after exceeding expectations in the first quarter. In contrast, Walgreens Boots Alliance ($WBA) also emerged among the top gainers on the S&P 500, with shares climbing 7.5%. The drugstore chain has agreed to a buyout by an affiliate of Sycamore Partners, a significant transaction valued at up to $23.7 billion. However, the mood turned negative for Hewlett Packard Enterprise ($HPE) as its stock plummeted 12%, the worst performer on the S&P 500 for the day.
This decline follows their disappointing full-year earnings forecast and an announcement regarding impending job cuts. Another retailer, Costco Wholesale ($COST), retreated 6.1%, announcing a miss in quarterly earnings that was declared late Thursday. In commodity markets, gold prices dipped by 0.3%, reaching $2,918.90 per troy ounce, while silver fell by 1.2%, settling at $32.95 per ounce..